Blog

I once had an Accounting firm who had been considering engaging us to run a change management program across their business, tell us that ultimately the board had decided that they didn’t believe in paying for external guidance.

Imagine an Advice business saying that it didn’t believe in it’s own value? Yet that is a trap that is so easy for us to fall into.

There is a simple saying that is used consistently in any form of elite sports ‘you can’t be your own coach’. In that truth, however, is a lesson not just for athletes but one that is profound for all AdviceProfessionals.

Understanding this simple concept is the key to unlocking your deepest value as well as overcoming all of your own business limitations. Not only can you not be your own coach, you can’t be your own Adviser.

You see that is your greatest value, being able to do for your clients what they cannot do for themselves… Advice helps people to take their emotions, their decisions and their possibilities and to put context around them.

Your deepest value comes from your ability to help your clients see and act clearly and all you need to do to have them recognise that and be happy to pay you for it is to believe it.

A good Adviser can change the course of someone’s life for the better in a few words. On the other hand, a technically proficient, compliant, and process driven filler of time sheets can deliver a whole lot of actions for a fee that creates very little impact for the client.

The reality is that there is no inherent value in the things we do in the guise of service – value only comes from the benefit we create and has no correlation to how much we do in order to create that impact.

Now I’m not saying that we don’t need compliance, best practice or process, because we do. I’m saying that all of those things should only ever be a means to deliver the real part of Advice, the part that helps clients make realisations, change behaviour, and make smarter decisions to get more of the life they really want.

The second thing we all need to realise as Advisers is that we cannot be Advisers to ourselves.

Of all of the professions I have encountered those who deliver Advice are the ones least likely to seek it out and pay for it.

To believe in what you do, you should believe in what you do. Help your clients to have more of the life they want, just don’t forget to ask for help in having the same for yourself.

Baz

P.S. If you would like to talk about this in any more detail, drop me a line or let me know in the comments…

Ok, so I am going to take what may be a controversial stance here. You see, I believe that most professional services firms are undercharging their clients in a systematic way.

Or more precisely, they are confused about the real value they bring to clients and are consequently over delivering on service while undercharging on value.

It’s not just the professionals that I perceive are confused, it is also the institutions – the educational institutions and the politicians.

Let’s take Financial Advice in Australia as a proxy for my point. Right now we have ASIC and the Royal Commission in Australia focused on issues like ‘fee for no service’.

Now I’m not going to comment on the systemic issues the Royal Commission has raised with the Financial Advice ecosystem, and nor am I going to comment on the small minority of individuals who have clearly done the wrong thing by their clients.

My message instead is for the vast majority of Advice Professionals who are legitimately drawn to the idea of Advice and being of service to their clients.

Every year I meet with hundreds of Business Owners and Practicing Professionals in the Advice and Service fields. I also get to speak at events and have thousands of conversations on social media. Here is what I am observing whether it’s in the Financial Advice, Accounting, Consulting or Legal space.

Believing that service is an output rather than an input

Think about the fact that our businesses are labeled as ‘Professional Services’. As humans, we are prone to creating and abiding by such labels which indoctrinate our thinking and affect our behaviour. We have come to believe that service is the end result that we deliver to our clients instead of it being just an input to the value that our actions create.

Our educational institutions reinforce concepts of process-driven actions to justify fees charged to clients and our regulators are following suit by focusing on even more linear ways to force more actions as a way to create better outcomes for clients.

This misunderstanding is that actions under the guise of service are the output for the client, when in fact they are just another input and only relevant in how they contribute to the output (if they, in fact, do at all).

Which directly leads me to my next observation.

Believing that value comes from how much you do rather than the impact you have

A good Adviser can change the course of someone’s life for the better in a few words. On the other hand, a technically proficient, compliant, and process driven filler of time sheets can deliver a whole lot of actions for a fee that creates very little impact for the client.

The reality is that there is no inherent value in the things we do in the guise of service – value only comes from the benefit we create and has no correlation to how much we do in order to create that impact.

Now I’m not saying that we don’t need compliance, best practice or process, because we do. I’m saying that all of those things should only ever be a means to deliver the real part of Advice, the part that helps clients make realisations, change behaviour, and make smarter decisions to get more of the life they really want.

Most Advisers do not understand their own value

The cold truth is that most Advisers do not understand their own value, they articulate it poorly to clients and they focus on the justification of their fees based on the amount of work delivered, the tasks undertaken or the linear benefits produced, i.e. investment return, tax saved etc.

Getting a job done, creating a tax saving or generating an investment return, are also only inputs to the value a client perceives, they are not the output itself.

As technicians we are taught that our value is in our knowledge and in our time. The truth is that our value only comes from how we bring those things to bear in order to impact the lives of our clients.

The Truth

Put simply, most firms I have researched are, in my opinion, undercharging a significant portion of their client bases. This means they are unable to reach critical mass, are unable to ‘process drive’ sufficiently the compliance aspects of their business, and do not have enough head-space, time, or resources, to focus on the most impactful ways to bring the greatest value to their clients.

Most are also over delivering on things that look good as a fee justification but do not actually bring value to clients.

It’s easy for firm owners to justify this situation as a means to protect clients. The truth is that sheltering your clients from an honest conversation about value and fees is the opposite of acting in their best interest.

There is no point using technology to leverage efficiency or social media to multiply your new business growth if you are not first and foremost clear on what your value is, who you deliver it to and that you charge all of your clients appropriately for the value you bring.

Baz

P.S. If you would like me to expand on the theory and action you can take to better engage your clients and set your fees, drop me a line or let me know in the comments…

The discussion of fees with clients seems to be one of the most hit and miss aspects of the Services Professions, and yet it is also undoubtedly the most important part of creating a mutually beneficial and sustainable relationship.

I spend a lot of my time helping firms get their models, their messages, their service and their fees right. As much as I like creating leverage for business growth, no firm or professional should be seeking to grow if they don’t have their foundations in order.

I have said this before – the value that your clients perceive in your relationship is largely determined by the value you perceive they gain from that relationship.

If you are hesitant, they will be hesitant.

If you are unsure of the value, they will be unsure of the value.

If you make the value about transactional issues, then so will they.

If you make the value based on X work at Y cost, then that is what they will measure you on.

If you treat the issue of fees as a question to be addressed, then so will they.

The truth is that it is always your bias and preconceived ideas that lead to imbalances in your client relationships. Even perhaps more difficult to hear is that we all have blind spots, and as the name implies, we are blind to the reality of the issues we have created for ourselves.

So, if you would like my number 1 tip for better negotiation of your client fees it is this… Remember it is almost impossible to be your own coach. I may be great at pointing out the blind spots of my clients, but I rely on my coaches and mentors to help me look out for my bias when it creeps in. Nowhere is this harder to do than in how you look your clients in the eye and have an open and honest conversation about value.

Shine a light on your business; how you charge and express your value is the greatest lever you have. Not only will it determine your profitability, it will also determine your rate of referrals and the satisfaction of your clients. It might even lead to that extra family holiday every year 😉

Baz

Have you ever had a client tell you that they were not going to go ahead with working with you, yet the reason they give you just doesn’t make any sense?

Invariably your ‘no’ comes in the guise of such famous lines as:

“The price is too high”. Meanwhile, you are thinking “but I just showed you how to spend X to save Y” (with Y being a multiple of X!).

“The time isn’t right”. When in reality they, of course, have no time to lose and waiting will just make their position worse.

“My brother-in-law does what you do and we have decided to see him”. However, you know for a fact he has been unemployed for years.

There is a reason that the word ‘rationalisation’ exists, and at times, that is to try and give a description of the act of giving a rational excuse for an irrational action.

In most cases, when your clients are giving you these reasons for not proceeding it is because there has been a mismatch in their subconscious drivers. This is what I describe in my work with Service Businesses as a Context Mismatch.

A context mismatch occurs when you have not gone deep enough with a client to uncover the key fears or drivers which may directly relate to them being in conflict with your advice to them.

For example, the Financial Adviser who suggests to a client to sell a large shareholding in order to diversify risk and create a more effective portfolio moving into retirement. Yet in this example, the client inherited the shares from their deceased father who always said to him “always buy shares and forget about them”.

Usually, a client does not consciously know they are in context conflict with your advice, and often if asked, they will not be able to answer explicitly with their reasons.

I can tell you, after more than 20,000 client meetings, that they may not tell you consciously but they will always give you clues subconsciously. The trick is to listen more to what is not said, than is said, and to question deeply with compassion… but to do it relentlessly.

1. Bring fear into the light

Most of the time I find that just the simple act of bringing the fear into the light means that it is dispelled. For example, getting the client to admit that they have a sentimental attachment to the shares. (FYI – A sentimental attachment, in this case, means a fear of what their deceased father may think of them.)

2. Give it perspective

For example: “I understand your father passed these shares to you and that you may have a sentimental attachment to them, however, it is my suggestion that your attachment may cause you to make decisions that will impact your ability to achieve your real goals in life.”

3. Re-frame it

By taking the driver’s seat and re-framing it in a positive direction, you can often help your client easily move past such a roadblock. For example: “Your father taught you well the value of not making emotional decisions when it comes to investment. Buying assets like shares and holding onto them for a long time is exactly the principle we are sticking to. Our suggestion is to do exactly that but to be even smarter by diversifying your long-term assets and creating a better tax position. Ultimately, we are working on the same strategy you inherited and just adding to the same principles.”

At the end of the day, in our example, you are dealing with an emotive driver that cannot be dealt with through direct logic. By having these conversations you are now in the position to help the client not just make better money choices but to change their life by learning to live with the hangups they may have inherited along with their assets

This is where real advice lives, as does the ability not just to give a good service but to change lives.

Go deep, have better clients and give them better lives.

Baz

P.S. If you would like me to expand on the theory and action you can take to better understand the emotional context of your clients, drop me a line or let me know in the comments…

I put up a post on LinkedIn last week asking how ‘Fee For Service’ was still a thing and it has raised some interesting perspectives. By the way, if you would like to check that out and to join the conversationclick here.

So, I thought I would raise the next logical question: ‘What exactly is your value to a client?’. Because this may well be THE question, it is going to take more than one post!

Today I am going to share with you my number 1 overlooked contributor to misaligned client value perception.

Perhaps I should start by saying what I do NOT believe your value is.

It is not:

How much you do for a client

How little you charge for what you do

How many hours you spent working for a client

A reflection of how happy a client is

A reflection of how quickly a client pays their bills

How much you were able to bill a client

How much money you saved a client

How much money you created for a client

How good your advice or service was/is

How experienced or knowledgeable you are

Whilst none of the above are your value, each of these may contribute to the creation and translation of your value. You could say, don’t mistake the ingredients for the cake.

A problem with our definition of value

In its simplest form, value is a seemingly nebulous psychological reaction, if you will, a perception that exists in the mind of your client.

A typical dictionary definition runs like this :

“The extent to which goods or services are perceived by its customer to meet his or her needs or wants, measured by a customer’s willingness to pay for it.”

Value isn’t just in the clients mind

You see, whilst technically true that value is ultimately in the mind of the receiver, it is also completely false because that value is inextricably tied to the ‘perception of value’ of the professional providing the value.

It seems clear that value is created by the perceptions of both the provider and the receiver of a service as they interact to create a psychological shift in the mind of the receiver.

Of course, with businesses that have an ongoing service model with their clients, the value is the result of a ‘perception loop’ between the deliverer and the receiver that is a constant state of mutual interaction.

What does this mean?

It means that the ‘perception of value’ of your clients is inextricably linked to your own perception of your value.

The vaguer you are on your value, the vaguer your clients will be too. The more you perceive your value to be based on weak influences such as time, returns, process etc, the more your clients will consider your value to be based on those things and the weaker their overall sense of your value.

I find professionals rarely have a problem with ‘sales’ or charging appropriately, the problem is in fact with their own perception of value, either in what they are doing or more specifically themselves.

There are a thousand things to look at when helping to drive the effectiveness of a Services Firm, yet there are few that can create the kind of radical results that shifting into alignment the ‘value context’ of the professionals who work in that firm can create.

Most often the greatest opportunity exists in helping the firm owner/s to define their own limiting perceptions of value that are unconsciously being communicated both internally and externally.

In my experience, you must first liberate your own concepts of value before you can truly engineer a business to create maximum mutual value for you and your clients.

Whilst clients have their sense of value affected by a huge range of variables, in my experience, the single greatest determining contributor is the perceptual cues they take both consciously and subconsciously through YOU.

Baz

P.S. If you would like me to expand on both the data behind this as well as expanding on the theory and action you can take to master the art of value, please let me know in the comments…

In our world that means a few certain things, other than I might be able to lift really heavy things or to stand up to go to the bathroom.

It means that there is a certain societal way of doing things. Of what is and isn’t appropriate and in what situations.

I’m also a professional… that is to say I am in the business world and deliver service to others in exchange for value.

That also means certain things in terms of what I have been taught about what is and isn’t right.

As I have got older and travel led through the school of hard knocks, I have come to realise that most of those truths are not my truths and that I am choosing now to move in a different direction.

The first ‘false truth’ is that being your real authentically vulnerable self in business will not equal success.

The second ‘false truth’ is that as a man in a business world, having love for people does not have a place.

I have discovered that the best way to create a business is through being true to myself. I have also decided that feeling love for my team and for my clients IS my service offering.

If I can’t give and receive love from you, why would I want to spend my time with you?

This kind of thinking isn’t what is considered appropriate in a societal sense. It’s not what we talk about or what we demonstrate.

I have decided that is no longer my truth, and if that makes someone uncomfortable then I am ok with that.

If people want to work with me they should understand that love is going to be the underpinning principle and if they don’t want that I’m ok with that too.

So I ask you, what is your real service offering? Let me know what you think in the comments below.

I am building a community of Advice & Service Firm Owners who are committed to accelerating every element of their businesses and to building their profiles through authentic leadership, innovation, and mutual support.